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November 25, 2002

Canada and India to Boost Ethanol Use

OTTAWA, Nov 21 (Reuters) - The Canadian government said on Thursday it wants to boost the use of ethanol in gasoline to help implement the Kyoto protocol on climate change.
Ethanol from grain has about 40 percent fewer greenhouse gas emissions than gasoline, and ethanol from cellulose fibers such as straw -- a new approach still under development -- has about 80 percent fewer emissions.
The government said it wants 35 percent of the gasoline sold in Canada by 2010 to contain 10 percent ethanol as part of its drive to limit greenhouse gases that are blamed for global warming.
An earlier initiative had set the goal of increasing ethanol fuel use from the current level of 240 million liters a year to 1 billion liters in 2010, enough ethanol to blend into 25 percent of Canada's gasoline.
Current vehicles can use up to 10 percent ethanol-blended gasoline without any adjustment to, or effect on, the engine.
The government also proposed the production of 500 million liters of biodiesel by 2010. Biodiesel is a diesel fuel substitute that can be made from a variety of vegetable oil and animal fats, such as recycled cooking grease.
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India Pushes Forward With Fuel Ethanol Program

CHENNAI, Nov. 21 THE Tamil Nadu Government has passed an order enabling distilleries to manufacture, transport and handle anhydrous ethanol in the State.

This paves the way for production of ethanol-blended petrol - gasohol - by permitting distilleries to set up anhydrous alcohol manufacturing facilities and the oil companies to handle and transport ethanol within the State.

According to reliable sources, the order has been long-awaited one since it was a prerequisite for supplying ethanol-blended fuel, the supply of which has been made mandatory from January 2003, by the Central Government. Following the issue of the order, it will now be up to the Commissioner of Prohibition and Excise to endorse the licenses of the distilleries and license the oil companies to handle and process ethanol, they said.

According to sources, the order initially permits the existing distilleries linked to sugar mills to manufacture anhydrous ethanol. Applicants who were hoping to set up new distillation facilities are yet to be given the go ahead.

The industry can now relax with the State Government's go ahead given as this enables them to approach the financial institutions or other funding agencies for assistance.

The Central Government had cleared the move to blend ethanol and petrol on September 12. The State Government, the licensing authority, had assured the industry a few days later that the required clearances would be given.

The sugar mills in Tamil Nadu had been loathe to set up facilities without a clear go-ahead from the Central Government and the State Government since the project involved several crore rupees in investment.

The units had been looking forward to the announcement since the idea was first mooted in the Centre's budget announcement earlier this year.

With the Centre giving the commitment in September and the State Government now, the units are expected to commence work on setting up anhydrous alcohol manufacturing facilities, sources said.

Meanwhile, the oil companies have called for bids from the distilleries for the supply of anhydrous ethanol by December 1 so as to enable them to commence supply of anhydrous ethanol by January 1, 2003, in Tamil Nadu.

However, according to sources, the oil companies will now have to look elsewhere for their suppliers.

The units in Tamil Nadu are likely to commence production of anhydrous ethanol during the first quarter of 2003.

According to industry sources, six private sector distilleries linked to the sugar mills had applied for the licences.

These include the Thiru Arooran Sugars Ltd, EID Parry, Dharani Sugars, Sakthi Sugars, Rajshree Sugars and Kothari Sugars and Chemicals Ltd. Four other units including two in the cooperative sector, the Amaravathi Cooperative Sugar Mill and the Salem Cooperative Sugar Mill, and the private sector S.V. Sugars have evinced interest in putting up the distillery.
 

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